ED says no probe yet into complaints against SoftBank

The Enforcement Directorate, the country's top economic intelligence agency, has not yet begun investigations into complaints filed against SoftBank, as well as one of its senior executives and a former top executive, by representatives of some shareholders in the Tokyo-based company.

A senior official with the ED said that while the agency is aware of the allegations, no investigations have been initiated yet. “These allegations pertain to actions of individuals, but what we may be interested in is if the said companies have violated any foreign direct investment (FDI) rules,“ said the official.

“A potential case for investigation could be kickstarted, if funds, which were slated for investments in the portfolio companies, were instead routed for alleged kickbacks,“ he told ET.

SoftBank has denied all allegations of financial malfeasance.

On Friday , financial daily Wall Street Journal reported that representatives of an undisclosed number of SoftBank shareholders had expressed concern about the conduct of Nikesh Arora, the former president of the Japanese telecomto-technology giant, and Alok Sama, the current chief financial officer of its international arm, pertaining to investments made by it, particularly in India.

The article also stated that an official complaint had been submitted to the ED in March, detailing instances of financial impropriety , kickbacks, conflicts of interest and improper consulting arrangements. While the WSJ report did not explicitly state which SoftBank investment in the country was under scrutiny , it mentioned online marketplace Snapdeal, real estate portal Housing.com and cab-hailing app Ola.

Most of those investments were led by Arora during his time at the company . SoftBank, the largest investor in the Indian startup eco system, has invested close to $4 billion in Asia's third-largest economy , having closed a $1.4-billion funding round in digital payments platform Paytm, earlier this week.

“We are aware that certain individuals are waging a malicious smear campaign against SoftBank and its senior executives through a series of defamatory letters. These submissions are based on falsehoods and innuendo, littered with inaccuracies and are a blatant attempt to damage SoftBank's reputation, and that of its respected ex ecutives,“ SoftBank said in astatement.

“While SoftBank has the deepest respect for the rights of shareholders to raise legitimate concerns, we will not allow ourselves or our executives to be victims of a shameless intimidation scheme,“ it said.

Nikesh Arora, once the heir apparent to billionaire founder Masayoshi Son, who quit SoftBank abruptly last June, also denied the charges that were first reported last year. “None of the allegations contain even a shred of truth.The entire project is a blatant attempt at slander, besmirching personal reputations and damaging a great company like Soft Bank,“ he said.

Sama also slammed Sama also slammed the charges, ter ming them “corpo rate terro rism.“ The Enforcement Directorate, the country's top economic intelligence agency , has not yet begun investigations into complaints filed against SoftBank, as well as one of its senior executives and a former top executive, by representatives of some shareholders in the Tokyo-based company .A senior official with the ED said that while the agency is aware of the allegations, no investigations have been initiated yet. “These allegations pertain to actions of individuals, but what we may be interested in is if the said companies have violated any foreign direct investment (FDI) rules,“ said the official.

“A potential case for investigation could be kickstarted, if funds, which were slated for investments in the portfolio companies, were instead routed for alleged kickbacks,“ he told ET.

SoftBank has denied all allegations of financial malfeasance.

On Friday , financial daily Wall Street Journal reported that representatives of an undisclosed number of SoftBank shareholders had expressed concern about the conduct of Nikesh Arora, the former president of the Japanese telecomto-technology giant, and Alok Sama, the current chief financial officer of its international arm, pertaining to investments made by it, particularly in India.

The article also stated that an official complaint had been submitted to the ED in March, detailing instances of financial impropriety , kickbacks, conflicts of interest and improper consulting arrangements. While the WSJ report did not explicitly state which SoftBank investment in the country was under scrutiny , it mentioned online marketplace Snapdeal, real estate portal Housing.com and cab-hailing app Ola.

Most of those investments were led by Arora during his time at the company . SoftBank, the largest investor in the Indian startup eco system, has invested close to $4 billion in Asia's third-largest economy , having closed a $1.4-billion funding round in digital payments platform Paytm, earlier this week.

“We are aware that certain individuals are waging a malicious smear campaign against SoftBank and its senior executives through a series of defamatory letters. These submissions are based on falsehoods and innuendo, littered with inaccuracies and are a blatant attempt to damage SoftBank's reputation, and that of its respected ex ecutives,“ SoftBank said in astatement.

“While SoftBank has the deepest respect for the rights of shareholders to raise legitimate concerns, we will not allow ourselves or our executives to be victims of a shameless intimidation scheme,“ it said.

Nikesh Arora, once the heir apparent to billionaire founder Masayoshi Son, who quit SoftBank abruptly last June, also denied the charges that were first reported last year. “None of the allegations contain even a shred of truth.The entire project is a blatant attempt at slander, besmirching personal reputations and damaging a great company like Soft Bank,“ he said.